UAE gave Trump crypto firm $500 million as 'bribe' for access to AI chips: Report
Washington had previously limited the UAE's purchases of the chips, fearing the technology would be passed on to China
The UAE signed a deal to invest $500 million in Donald Trump’s cryptocurrency startup, just weeks before the US President lifted a ban on selling advanced AI chips to the energy-rich Gulf nation, raising concerns about corruption and conflicts of interest, The Wall Street Journal(WSJ) reported on 1 February.
The deal was signed four days before Trump returned to office in January, giving the UAE a 49 percent stake in his World Liberty Financial, according to company documents and people familiar with the matter.
Half of the $500 million was paid up front, with Trump family entities receiving $187 million and entities linked to World Liberty co-founder Steve Witkoff receiving $31 million.
Witkoff, a New York real estate mogul, is a close friend of Trump. The president named him as special envoy, tasking him with overseeing negotiations with Russia regarding the Ukraine war and with Israel regarding Gaza.
The deal with World Liberty Financial was signed by Eric Trump, the president’s son.
Just months later, the US “committed to give the UAE access to around 500,000 of the most advanced AI chips a year – enough to build one of the world’s biggest AI data center clusters,” the WSJ wrote.
The WSJ adds that the investment in Trump’s cryptocurrency company was backed by Sheikh Tahnoon bin Zayed Al Nahyan, a UAE royal who had been lobbying the US for access to the advanced AI chips, according to people familiar with the matter.
After Trump returned to office, Tahnoon met multiple times with him, Witkoff, and other US officials, including during a visit to the White House in March.
During Joe Biden’s term in office, US officials had tightly restricted the UAE's purchases of chips due to the Gulf emirate's close relationship with China. US officials feared that selling the chips to the UAE would allow China to gain access to their technology.
Trump's decision allowed one of Tahnoon’s own companies, the AI firm G42, to receive 100,000 chips each year, despite its close ties to the sanctioned tech giant Huawei and other Chinese firms.
Known as the “spy sheikh,” Tahnoon serves as the Emirates’s national security adviser and oversees its $1.3 trillion sovereign wealth fund.
According to the WSJ, “The deal marked something unprecedented in American politics: a foreign government official taking a major ownership stake in an incoming US president’s company.”
According to Kathleen Clark, a law professor and former ethics lawyer for the city of Washington, DC, the investment “looks like a bribe.”
The transaction, she said, “should be a five-alarm fire about the federal government being for sale.”
Trump’s conflicts of interest have far exceeded those of his predecessors. "It’s like complaining about kayaks when B52s are flying overhead,” said Ty Cobb, who served as a top White House lawyer in Trump’s first administration.
“My advice as an ethics lawyer would have been clear: You don’t do business deals with the families of the leaders of foreign countries. It taints American foreign policy," Cobb added.
In April, a Tahnoon-led investment firm, MGX, announced it would use World Liberty’s stablecoin to complete a $2 billion investment into the cryptocurrency exchange Binance.
The investment gave World Liberty a $2 billion cash reserve, which it used to maintain the coin’s 1-to-1 peg to the dollar. The company invests the money in US Treasury bonds and receives the interest, generating about $80 million yearly.
In October, Trump pardoned Binance founder Changpeng Zhao. Binance had been banned from the US after Zhao pleaded guilty to violating anti-money-laundering rules.
The pardon angered Democratic lawmakers, who accused Trump of selling pardons to the highest bidder.
Zhao, who lives in Abu Dhabi and obtained Emirati citizenship several years ago, is close to Tahnoon and the UAE royal family.